SPFL.L Regulatory News (SPFL)

20 Feb 2006 12:30

Lewis Charles Sofia Property Fund20 February 2006 The Lewis Charles Sofia Property Fund plc €9.25 MILLION LAND INVESTMENT FOR FIRST MAJOR SCHEME IN SOFIA The Lewis Charles Sofia Property Fund plc ("the Fund"), the residential propertyinvestment fund specialising in Bulgarian properties, is pleased to announce thefirst major acquisition since the launch of the Fund at the end of September2005. The Fund has contracted to buy 100,000 sq. m. of land in Sofia at a price of€9,250,000 (including costs for change of regulation). The Fund is currentlytalking to potential development partners with a view to building an exclusivegated residential housing scheme on the site. The Fund has submitted itsapplication to the local authorities for a change of use consent fromagricultural to residential. The land is located to the southeast of the Bulgarian capital Sofia, near thebottom of the Vitosha mountain. The current population of Sofia is 1.1 millionand growing. The Fund anticipates that this will create extra demand on analready stretched property market. The land is situated in one of theattractive, wealthier suburbs of Sofia. The Fund believes that the site ishighly sought after and is ideally placed to take advantage of this anticipatedpopulation expansion. The site is very close to the ring road of Sofia and haseasy access to all parts of the City including the newly constructed SofiaBusiness Park which is attracting major multi-national companies (e.g. 3M, Sony,hp, Johnson & Johnson, Kraft, BMW, Porsche) It is also close to the largestcommercial development in Sofia, providing jobs for 10,000. Nearby there is alsoa large retail hypermarket, multicomplex cinemas, a new Holiday Inn hotel andthe new American College. The site sits firmly in the middle of the area designated for residential use inthe expansion of the City as envisioned in the Master Urban Plan (MUP). The MUPis currently awaiting ratification by parliament. The site faces south-west andreceives the sun all day whereas much of the prime property in the South of theCity is located on the northern slopes of the Vitosha mountain and as a resultreceives less evening light. The northern boundary of the plot opens up ontonational park land which cannot be developed. The residential property market in Sofia is currently buoyant. According tolocal property sources, prices of land around Sofia are continuing to increase.The average price for land in suburbs of Sofia such as Dragalevtsi (inregulation) is now €146 per square metre, Simeonovo €160 per square metre andBoyana €197 per square metre. Simeonovo is the nearest location to the plot ofland acquired by the Fund. In addition, large size parcels are selling at apremium because of the time taken to consolidate ownership. As such thisrepresents a rare and exciting opportunity. To date the Fund has invested approximately 36.8% of the funds raised at launchnet of all expenses. Lord Howard of Penrith, the Chairman of the Fund, commented, " This is an important milestone in the development of the fund. To assemble asite of this quality demonstrates clearly the strength of the team's contacts inBulgaria. Investing in residential property in Bulgaria offers a wealth ofopportunities and we look forward to announcing more progress in the nearfuture." Stavros Loizou, Managing Director of Lewis Charles said: " We are delighted that we have secured this major site in Sofia. Theresidential property market in the Bulgarian capital has excellent prospects.Driven by an increasing population and a more affluent, professional middleclass, the demand for affordable yet stylish residential property is growingrapidly. We are well placed to benefit from these structural changes in theBulgarian property market. " One of the barriers to entry for major residential schemes is the difficultyin site assembly, as the nature of historic land ownership is extremelyfragmented. We have worked hard with our local contacts to put this major schemetogether." -ends- Date: 20th February 2006For further information contact: Lewis Charles + 44 (0)20 7065 1150Stavros Loizou, Managing DirectorLoraine Pinel, Fund Manager Panmure Gordon + 44 (0)20 7614 8388Dominic Morley, DirectorStuart Gledhill cityPROFILE + 44 (0)20 7448 3244Simon CourtenayLynn Mah This information is provided by RNS The company news service from the London Stock Exchange